Tags: O’Neill | Pandit | Citi | ouster

NYT: Citi Chairman Planned Pandit Ouster for Months

Friday, 26 Oct 2012 01:06 PM

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Citigroup CEO Vikram Pandit’s abrupt resignation the day after the bank released earnings that pleased Wall Street was actually the result of months of planning from Citi Chairman Michael O’Neill, The New York Times reported.

A day after releasing earnings, O’Neill presented Pandit with three press releases, one saying Pandit had resigned, another stating he would resign at the end of the year and a third saying he was fired without cause, according to The Times.

The choice was Pandit’s, who chose the first, sources told the newspaper.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

“The board has lost confidence in you,” O’Neill reportedly told Pandit, The Times added.

Citi’s board and Pandit had reportedly been locking horns over strategies and operating performance. O’Neill wanted Pandit out, especially when the Federal Reserve rejected Citi’s plans to buy back shares and increase its dividend earlier this year.

Over several months, O’Neill approached board members to get their backing for a change of CEO.

Meanwhile, former Citi Chairman Richard Parsons said that Pandit’s departure was the right thing to do.

“You need seasoned, honed managers who can cause a 250,000, 300,000-personnel organization to march” with direction, Parsons told Bloomberg.

“Vikram will tell you, ‘That’s not my bag.’”

Michael Corbat, who ran the Citi Holdings unit, which manages sour assets, and was CEO of Citi's Europe, Middle East and Africa division, replaced Pandit and is the right executive to cuts costs and streamline the bank, Parsons said.

“Mike Corbat, who I knew back in the day when he ran the Holdings operation, is just that kind of man,” said Parsons, Bloomberg added.

While the timing of Pandit’s exit was surprising, the fact the he left was not.

“The transition and change was, in the long term, not inevitable but appropriate,” Parsons added.

Editor's Note:
How You Lost $85,000 During the Last Decade. See the Numbers.

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